The Commission brought an action naming fourteen individuals as defendants who sold interests in a massive Ponzi scheme. The complaint centers on claims that they ignored red flags indicating that the fund was a fraud. SEC v. Arias, CV 12-2937 (E.D.N.Y. Filed June 12, 2012).
The action focuses on the Agape World, Inc. Ponzi scheme operated by Nicholas Cosmo. Agape sold investment contracts. The securities were suppose to represent participation in short-term, high interest bridge loans made by the fund to specific commercial borrowers in real estate, construction or other industries. The investment contracts, named after the project for which financing were purportedly being extended, promised investors that they would receive from 8% to 19% returns on maturities from thirty to seventy-four days. Only 1% of the investor’s principle was to be at risk. The remaining 99% was represented to be secured by first position asset liens representing 100% of the investment. The investment was to be held in a client custodial account, investors were told.
Agape was a Ponzi scheme. Its shares were never registered with the SEC. By 2009 investors filed an involuntary Chapter 7 petition against the fund. In re Agape World, Inc., 09-70660 (E.D.N.Y.). In October 2010 Mr. Cosmo pleaded guilty to one count each of mail and wire fraud and admitted that the representations made to investors were false. In fact only a small portion of the investor funds were ever invested. In part the money was used to trade futures in personal accounts. Other portions were used to repay investors. In October 2011 Mr. Cosmo was sentenced to serve 300 months in prison and ordered to pay $179, 195, 233 in restitution U.S. v. Cosmo, CR-09-255 (E.D.N.Y.). Prior to the Agape schem he had pleaded guilty to one count of mail fraud in the same district and was sentenced to serve 21 months in prison and pay $177,000 in restitution. In 1999 the NASD (now FINRA) had censured, barred and fined him for stealing funds from customer accounts.

The defendants in the Commission’s action are divided into two groups.

The first is the brokers which include Bryan Arias, Hugo Arias, Anthony Ciccone, Salvatore Ciccone, Diane Kaylor, Jason Keryc and Anthony Massaro. The second is the sub-brokers which includes Christopher Curran, Michael Dunne, Martin Hartmann, Michael Kerye, Ronald Roaldsen and Laura Tordy.

The brokers represented to investors that they were account representatives and vice presidents for Agape. The sub-brokers worked for the brokers.

According to the complaint, the defendants knowingly, or recklessly, and repeatedly made misrepresentations to investors about Agape securities despite “numerous signs of fraud” which included:
The prior conviction of Mr. Cosmo for fraud;
The too-good-to-be-true returns;
The incredible claims regarding the safety of the principle;
Agape’s status as a relatively small, unknown, private issuer of securities;
A series of extensions and defaults by Agape; and
Warnings about the fund’s financial condition.
The scheme ended in January 2009 when Mr. Cosmo was arrested. Defendants Ciccone, Kaylor, Kerye and Massaro were arrested in April 2012. U.S. v. Karye, 12 mj-000410 (E.D.N.Y.). They were charged with one count of conspiracy to commit mail fraud.
The Commission’s complaint alleges violations of Securities Act Section 17(a) and Exchange Act Section 10(b). The case is pending.

]]>By: Justinhttp://libn.com/2012/06/12/14-agape-world-ponzi-scheme-brokers-charged-by-sec/comment-page-1/#comment-100771
JustinMon, 25 Jun 2012 19:43:17 +0000http://libn.com/?p=78819#comment-100771I totally agree. The whole family beginning with the big drunk Hartmann police man = horrible horrible people. I once told Marty the whole 14-16% interest return was a scam, he insisted it wasn’t . I heard he even stole $50,000 from his wife’s mother to buy this big house. He blabs his big mouth at bars all over town telling everyone he made 4 million from agape. Wonder how much he spent on drugs and alcohol. The sad thing is all the Hartmann children are the ones to suffer. Too bad.
]]>By: Love U Laura Annhttp://libn.com/2012/06/12/14-agape-world-ponzi-scheme-brokers-charged-by-sec/comment-page-1/#comment-100756
Love U Laura AnnSat, 23 Jun 2012 18:50:56 +0000http://libn.com/?p=78819#comment-100756Just a little information for all of you….while some or all of you are worrying about the financial future of your families…these sub-brokers especially Tordy has no regard for anything she has done. She continues to live a big *** lifestyle…she is watching kids out of her home which I’m sure is cash…so the authorities are going to have to dig really deep if they want recover any monies from her.

I guess she can’t return to her former careers as a court reporter, nurse or mortgage broker…wow she’s really intelligent…NOT.

She renovated her home extensively, cars, jewelry, vacations, you name it with other peoples money. Refer to the SEC complaint…she made approximately $1 million in two years…she sent her husband to the Superbowl right after her boss was arrested…and that *** does not make anywhere near $500,000 a year…With all that she has no remorse whatsoever. An individual with that kind of evil is born that way and she may have fooled a lot of people, but one day as they say, she will get hers and it can’t come soon enough.

The whole family beginning with the big Hartmann = horrible horrible people.

]]>By: Kevinhttp://libn.com/2012/06/12/14-agape-world-ponzi-scheme-brokers-charged-by-sec/comment-page-1/#comment-100748
KevinFri, 22 Jun 2012 18:13:39 +0000http://libn.com/?p=78819#comment-100748so long in your new digs a-holes.
]]>By: DOJhttp://libn.com/2012/06/12/14-agape-world-ponzi-scheme-brokers-charged-by-sec/comment-page-1/#comment-100696
DOJTue, 19 Jun 2012 00:18:10 +0000http://libn.com/?p=78819#comment-100696Wait until the Dept.of Justice charges these fools. Forget about paying back every cent until they day they die, these scam artists will be behind bars for a long long time.
]]>By: Marty.hartmann@gmail.comhttp://libn.com/2012/06/12/14-agape-world-ponzi-scheme-brokers-charged-by-sec/comment-page-1/#comment-100640
Marty.hartmann@gmail.comSat, 16 Jun 2012 03:26:57 +0000http://libn.com/?p=78819#comment-100640”
To my knowledge Marty Hartmann reported directly to Jay Keryc. I also have heard that Sebastian Tauz did as well. I would imagine that Mike Keryc would have been a sub-broker for his brother and not under a different sub, so according to the affadavit R-6, R-7 and R-9 were all subs of R-1. If Jay Keryc was R-1 then I have to think these three guys would be r-6,r-7 and r-9. r-6 got 2.9 million from r-1 and 300k from agape. r-7 got 430k from r1. r-9 also owned a company and received 4.2 mill between aug 06 and nov 08 plus 35k from r1. r-9′s company also received 660k from r1. Marty hartmann also recruited his sister Laura-Ann Tordy and I believe she was a sub of his. A

Its funny – Laura-Ann Tordy was the Fat ***** I went to dinner with and she told me that Tom Hanks and his propduction company was involved Agape world… Oh Yeah she also claimed that many of the nassau county judges were/are investors as well! I found everything she stated hard to believe. I am convinced that she and her brother marty both knew what was going on with Agape.

I had a conversation with Marty last June. I was trying to get more information about the bridge loans and I found his number listed on this forum, so I called he was very nasty! I was asking very simple questions to which he had no answer. I told him I wanted to have my accountant and lawyer speak to the lawyer representing Agape. He told me they could not give out that information. I later told him that Agape seemed to good to be true and I questioned him about Agape being a Ponzi Scheme. He hung up on me, why would he do that if he didn’t know it was a scam?

I hope him and his fat beast of a sister roast in hell! These poeple are lucky this isn’t China, otherwise they would have met the firing squad already!

Washington, D.C., June 12, 2012 — The Securities and Exchange Commission today charged 14 sales agents who misled investors and illegally sold securities for a Long Island-based investment firm at the center of a $415 million Ponzi scheme.

Additional Materials
SEC Complaint
The SEC alleges that the sales agents — which include four sets of siblings — falsely promised investor returns as high as 12 to 14 percent in several weeks when they sold investments offered by Agape World Inc. They also misled investors to believe that only 1 percent of their principal was at risk. The Agape securities they peddled were actually non-existent, and investors were merely lured into a Ponzi scheme where earlier investors were paid with new investor funds. The sales agents turned a blind eye to red flags of fraud and sold the investments without hesitation, receiving more than $52 million in commissions and payments out of investor funds. None of these sales agents were registered with the SEC to sell securities, nor were they associated with a registered broker or dealer. Agape also was not registered with the SEC.

“This Ponzi scheme spread like wildfire through Long Island’s middle-class communities because this small group of individuals blindly promoted the offerings as particularly safe and profitable,” said Andrew M. Calamari, Acting Regional Director for the SEC’s New York Regional Office. “These sales agents raked in commissions without regard for investors or any apparent concern for Agape’s financial distress and inability to meet investor redemptions.”

According to the SEC’s complaint filed in the U.S. District Court for the Eastern District of New York, more than 5,000 investors nationwide were impacted by the scheme that lasted from 2005 to January 2009, when Agape’s president and organizer of the scheme Nicholas J. Cosmo was arrested. He was later sentenced to 300 months in prison and ordered to pay more than $179 million in restitution.

The SEC alleges that the sales agents misrepresented to investors that their money would be used to make high-interest bridge loans to commercial borrowers or businesses that accepted credit cards. Little, if any, investor money actually went toward this purpose. Investor funds were instead used for Ponzi scheme payments and the agents’ sales commissions, and Cosmo lost $80 million while trading futures in personal accounts. Meanwhile, the sales agents assuredly offered and sold Agape securities to investors despite numerous red flags of fraud including Cosmo’s prior conviction for fraud, the too-good-to-be-true returns, and the incredible safety of principal promised to investors. The sales agents also ignored Agape’s relatively small and unknown status as a private issuer of securities, Agape’s series of extensions and defaults, and other dire warnings about Agape’s financial condition. None of the Agape securities offerings were registered with the SEC.

The SEC’s complaint charges the following sales agents:

Brothers Bryan Arias and Hugo A. Arias of Maspeth, N.Y., who offered and sold Agape securities to at least 195 and 1,419 investors respectively. They received more than $9.5 million combined in commissions and payments.

Brothers Anthony C. Ciccone of Locust Valley, N.Y. and Salvatore Ciccone of Maspeth, N.Y., who offered and sold Agape securities to at least 535 and 348 investors respectively. They received more than $17 million combined in commissions and payments.

Brothers Jason A. Keryc of Wantagh, N.Y. and Michael D. Keryc of Baldwin, N.Y. Jason Keryc offered and sold Agape securities to at least 1,617 investors and received at least $16 million in commissions and payments. He also paid sub-brokers, including his brother, at least $7.4 million to sell Agape securities for him. Michael Keryc offered and sold Agape securities to at least 177 investors and received more than $1 million in commissions and payments.

Siblings Martin C. Hartmann III of Massapequa, N.Y. and Laura Ann Tordy of Wantagh, N.Y. Hartmann enlisted his sister in his sales effort while he worked as a sub-broker for Jason Keryc. Hartmann and Tordy offered and sold Agape securities to at least 441 investors and received more than $3.5 million in commissions and payments.

Christopher E. Curran of Amityville, N.Y., who worked as a sub-broker for Keryc. Curran offered and sold Agape securities to at least 132 investors and received at least $531,890 in commissions and payments.

Ryan K. Dunaske of Ronkonkoma, N.Y., who worked as a sub-broker for Keryc. Dunaske offered and sold Agape securities to at least 70 investors and received more than $700,000 in commissions and payments.

Michael P. Dunne of Massapequa, N.Y., who worked as a sub-broker for Keryc. Dunne offered and sold Agape securities to at least 99 investors and received more than $1.5 million in commissions and payments.

Diane Kaylor of Bethpage, N.Y., who offered and sold Agape securities to at least 249 investors and received at least $3.7 million in commissions and payments.

Anthony Massaro of Boynton Beach, Fla., who offered and sold Agape securities to at least 826 investors and received more than $5.9 million in commissions and payments.

Ronald R. Roaldsen, Jr. of Wantagh, N.Y., who worked as a sub-broker for Keryc. Roaldsen offered and sold Agape securities to at least 159 investors and received more than $600,000 in commissions and payments.
The SEC’s complaint charges Bryan and Hugo Arias, Anthony and Salvatore Ciccone, Jason and Michael Keryc, Dunne, Hartmann, Kaylor, Massaro, and Tordy with violations of Section 17(a) of the Securities Act of 1933, and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The complaint charges all 14 defendants with violations of Section 15(a) of the Exchange Act, and Sections 5(a) and 5(c) of the Securities Act.

The SEC thanks the U.S. Attorney’s Office of the Eastern District of New York and the Federal Bureau of Investigation for its assistance in this matter. Anthony Ciccone, Kaylor, Jason Keryc, and Massaro have previously been arrested on a criminal complaint charging each of them with conspiracy to commit mail fraud based on their conduct as Agape sales agents. The SEC also acknowledges the assistance of the U.S. Postal Inspection Service and the Commodity Futures Trading Commission.

The SEC’s investigation was conducted by Celeste Chase, Philip Moustakis, and Yvette Panetta in the New York Regional Office. The SEC’s related examination that led to the enforcement case was conducted by Richard A. Heaphy, Yvette Q. Panetta, Dawn M. Sacco, Joseph P. DiMaria, James E. Anastasia, Marianne Cala, and Steven Gilchrist. The SEC’s litigation will be led by Paul G. Gizzi and Mr. Moustakis.

during the period from September 2006 through January 2009, working as a Sub-broker for Jason Keryc, offered and sold Agape Securities to at least 441 investors. In August 2006, Hartmann incorporated Ocean to Bay Tours Inc., a false New York corporation, and he used accounts in its name for his Agape-related banking. During the period he offered and sold Agape Securities, Hartmann received, at least, $3,285,084 in commissions or other payments from Jason Keryc, and $309,734 gross in payments from Agape and AMA. During the same period, Hartmann paid Tordy -his sister at least $981,899, from Ocean to Bay Tours Inc. accounts, in commissions or other payments, to sell Agape Securities for him.

]]>By: Rushttp://libn.com/2012/06/12/14-agape-world-ponzi-scheme-brokers-charged-by-sec/comment-page-1/#comment-100635
RusSat, 16 Jun 2012 00:59:59 +0000http://libn.com/?p=78819#comment-100635Marty Hartmann is the biggest slim ball. He knew exactly want he was doing. I recent had run into him drugged out of his face and was telling the entire bar he made 4 million and was proud of it.
]]>By: Tardy Tordyhttp://libn.com/2012/06/12/14-agape-world-ponzi-scheme-brokers-charged-by-sec/comment-page-1/#comment-100634
Tardy TordySat, 16 Jun 2012 00:46:35 +0000http://libn.com/?p=78819#comment-100634Not to worry subbrokers the worst that can happen is every cent you earn goes from your employer to the innocent victims you scammed. Hope your children and family realize how gross you are. Thank you SEC!
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